For years, manufacturers have depended on the middleman to distribute goods and get merchandise in front of customers. Manufacturers, wholesalers, distributors and retailers were allies. But today, a shift in consumer behavior and the adoption of new technology are transforming the traditional supply chain. This transformation has been driven by: consumer demand for faster delivery and customized products; the price squeeze caused by low-priced imports; and e-commerce. Some manufacturers are selling direct to customers and cutting out the middleman.
Manufacturers that ship their products directly to consumers without relying on the middleman are considered direct-to-consumer (D2C) retail companies. Typically, they can sell their products at lower costs while maintaining end-to-end control over manufacturing, sales and marketing, and distribution. Well-positioned, streamlined D2C startups are able to connect directly with customers, grow fast and compete with the big retail brands. Direct sales can be a powerful source for increased profits and greater control over brand, price and customer data. As the lines between industries in the supply chain become uncertain, are allies becoming competitors?